Which of the following statements is true ?
A) Deflation is an increase in the general level of prices.
B) The consumer price index (CPI) measures changes in the average prices of consumer goods and services.
C) Disinflation is an increase in the rate of inflation.
D) Real income is the actual number of dollars received over a period of time.
E) The real interest rate equals the nominal rate of interest plus the inflation rate.

Question

Quizplus · Accepted Answer

The consumer price index (CPI) measures changes in the average prices of consumer goods and services. Deflation is a decrease in the general level of prices, disinflation is a decrease in the rate of inflation, real income is income adjusted for inflation, and the real interest rate is the nominal rate of interest minus the inflation rate.

Which of the Following Statements Is True